Earnings Beat: Aramex PJSC Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

Investors in Aramex PJSC (DFM:ARMX) had a good week, as its shares rose 3.8% to close at د.إ2.16 following the release of its yearly results. Revenues were د.إ5.7b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at د.إ0.088, an impressive 41% ahead of estimates. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Aramex PJSC

Taking into account the latest results, the current consensus from Aramex PJSC's seven analysts is for revenues of د.إ6.13b in 2024. This would reflect a reasonable 7.6% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 23% to د.إ0.11. In the lead-up to this report, the analysts had been modelling revenues of د.إ6.12b and earnings per share (EPS) of د.إ0.11 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at د.إ3.10. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Aramex PJSC analyst has a price target of د.إ4.50 per share, while the most pessimistic values it at د.إ2.40. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Aramex PJSC's rate of growth is expected to accelerate meaningfully, with the forecast 7.6% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 3.7% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 8.5% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Aramex PJSC is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at د.إ3.10, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Aramex PJSC analysts - going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Aramex PJSC that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.